Event to pay attention to today:
15:30 EET. USD – Non-Farm Employment Change
GBPUSD:
On Thursday, the GBP/USD pair experienced a sudden and significant decline, breaking a technical pullback from key averages and dipping below 1.2400. This move followed a rate cut by the Bank of England (BoE) of 25 basis points, which was accompanied by a hawkish monetary policy statement. This led to a shift in market expectations, with betting markets adjusting their predictions for further rate cuts to a later date than previously anticipated.
According to market participants, the Bank of England is expected to implement two or three additional rate cuts this year.The decision to cut rates was unanimous among all nine members of the Monetary Policy Committee (MPC), with seven voting for a 25 basis point reduction and two members, known for their bearish stance, opting for a double 50 basis point cut. While policymakers are anticipating the benefits of February’s rate cut, market expectations point to a further 70 basis points being taken away from the Bank of England’s discount rate this year.Another non-farm payrolls (NFP) data release is scheduled for Friday, and net job gains are forecast to decline to 170,000 in January, down from December’s 256,000.This week, close attention will be given to revisions of earlier data. Over the course of 2024, post-release revisions to the data have been on the upside, disappointing market participants who had hoped that cracks in US employment would help push the Federal Reserve (Fed) to cut rates further.
Trading recommendation: Trading predominantly Sell orders from the current price level.
Origin: FreshForex
